PROJECT SUMMARY A couple's economic circumstances are strongly associated with marital satisfaction and risk for divorce, and these associations are especially strong among lower-income couples. Yet the effect of economic changes on marital outcomes remains a topic of scholarly dispute. Economic and demographic research consistently reveals that rising unemployment rates and other indicators of economic hardship are associated with lower divorce rates. Psychological research, however, shows that the direct experience of economic insecurity is associated with higher risk of divorce. The overarching goal of the proposed research is to reconcile these literatures and explain how a couple's broader economic context interacts with the direct experience of their financial circumstances to affect marital outcomes over time. A premise of this work is that the social and temporal context of a couple shapes the way spouses interpret their own economic circumstances. When the people around a couple are also struggling financially, spouses should be less likely to blame each other for their own economic difficulties. When spouses perceive their incomes to be improving over time, they should be more optimistic about the economic viability of the marriage, even if their current income level remains low. These social and temporal comparison processes should directly affect associations between couples' current economic circumstances and their satisfaction with their marriage and risk for divorce. To evaluate this model, the proposed research will collect four additional waves of data from an existing sample of 375 first-married couples living in low-income neighborhoods. In a previously-funded project, these couples were assessed as newlyweds, and provided 5 waves of interview and observational data over 4 years (Time 1 to Time 5). The new data collection will include additional interviews and social network assessments collected in couples' homes every 9 months (Time 6 to Time 9). Analyses of the new data will examine: 1) how changes in couples' financial circumstances covary with changes in their evaluations of marital satisfaction, 2) whether spouses' attributions for their current financial circumstances moderate associations between their circumstances and their marital outcomes, 3) how social networks and social comparison processes shape the way spouses understand their own financial circumstances, 4) how trajectories of change and temporal comparison processes shape the way spouses understand their own financial circumstances, 5) how these comparison processes interact with couples' financial circumstances to account for trajectories of change in marital satisfaction and risk of divorce. Support for this perspective would have immediate implications for supporting lower-income couples and families, suggesting new targets for intervention (i.e., social and temporal comparisons), and allowing policy-makers to target vulnerable couples with more precision (e.g., networks instead of individuals).